Despite ongoing political instability, France’s business climate indicator held at 96 in September for the fourth consecutive month, below its long-term average. The survey was conducted after the confidence vote announcement, meaning business leaders’ responses already reflect the political turbulence. In this context, the indicator’s stability is somewhat reassuring.
The services sector saw a two-point rebound, driven mainly by improved assessments of past activity. However, general expectations fell sharply. The improvement was entirely due to the “information communication” sub-sector, which accounts for 29% of services. All other sub-sectors reported declines. In manufacturing, sentiment deteriorated due to weaker production and declining order books. Retail sentiment hit its lowest level since April 2022, amid worsening outlooks and rising uncertainty. The construction sector remained stable, while wholesale trade saw a modest improvement.
The most concerning development is the employment climate, which fell by two points due to reduced hiring plans in services. At 93, it now stands at its lowest level since January 2015, excluding the pandemic period. This sharp decline signals a likely slowdown in economic activity in the coming months.